They didn't, AND, the pharmaceutical company research facility (Pfizer) that was supposed to be an anchor/draw for the hotel moved to MA. Eminent domain should rarely, if ever, be used, and then only for definitely crucial purposes - not for bike paths, hiking trails, or a road that some developer wants so that his/her development will have better accessibility.
Yes, it ended up being a Pfizer building from across the river, then when they wanted out, my old company Electric Boat bought the building (LITERALLY across the river, so actually more sensical than the Pfizer complex to the south).
We finally visited again in 2015 and I got to see what happened with all this. It’s next to the old Fort Trumbull which I never got to visit when I lived there. Frankly I would not be happy as an engineer all the way across the river from the actual shipyard (yes, my old mentor told me about moving them), but there you go.